Company Overview - InnSuites Hospitality Trust (IHT) is scheduled to hold its Fiscal 2024 Annual Meeting of Shareholders on August 14, 2024, at its corporate offices in Phoenix, Arizona [1] - The company has filed its Fiscal 2024 Proxy on July 3, 2024, and the Annual Report on July 9, 2024 [6] Financial Performance - IHT hotel operations have shown strong performance in the current 2025 Fiscal Year, with record results from both the Tucson Hotel and Albuquerque Hotel for the 2024 Fiscal Year to date [2] - Hospitality revenues for the first five months of Fiscal 2025 have reached all-time record levels, alongside ten consecutive profitable quarters of Consolidated Net Income [3] Dividend Information - On July 9, 2024, IHT announced a semi-annual dividend of $0.01 per share, continuing a 54-year history of uninterrupted annual dividends [9] Strategic Initiatives - The company is progressing with its investment in UniGen Power, Inc., which focuses on high-risk, high-reward clean energy innovations [10] - IHT holds stock, convertible bonds, and warrants in UniGen, potentially leading to a 20% ownership stake upon full conversion/exercise [10]

Core Insights - InnSuites Hospitality Trust (IHT) is experiencing strong performance in its hotel operations, with record results reported for both the Tucson Hotel and Albuquerque Hotel in the current fiscal year [1][3] - The company has achieved all-time record hospitality revenues in the first five months of the 2025 fiscal year and has completed ten consecutive profitable quarters of consolidated net income [3] - IHT's management believes that the real estate held is undervalued compared to current market values, and the diversification into UniGen presents high profit potential despite its associated risks [3] Financial Performance - IHT announced a semi-annual dividend of $0.01 per share, continuing a 54-year history of uninterrupted annual dividends [6] - The company filed its Fiscal 2024 Proxy and Annual Report in July 2024, indicating ongoing transparency and communication with shareholders [7] Diversification Strategy - IHT has invested in UniGen Power, Inc., focusing on clean energy generation innovations, which could lead to a significant ownership stake of approximately 20% upon full conversion of its investments [8] - UniGen's prototype design engineering for its UPI 1000TA engine is substantially complete, and the company is currently seeking additional financing [8]

Core Insights - InnSuites Hospitality Trust (IHT) reported a consolidated net income before non-cash depreciation expense of $259,640 for the first fiscal quarter of 2025, indicating a positive financial performance [1] - The company experienced a total revenue increase to approximately $2.3 million, representing a 4% growth compared to the same period last year [13] - IHT's hotel operations have shown strong results, contributing to a solid start in the current fiscal year, with record revenues from both the Tucson and Albuquerque hotels [14][16] Financial Performance - Total consolidated fiscal first quarter net income remained positive at $86,598, reflecting the company's ongoing profitability [7] - The fiscal year 2025 marks the continuation of IHT's uninterrupted annual dividends for 54 years, with semiannual dividends paid on February 5, 2024, and anticipated for July 31, 2024 [10] Strategic Investments - IHT made a diversification investment in UniGen Power, Inc., a company focused on clean energy generation, which is expected to see increased demand due to the rise of electric vehicles and artificial intelligence [2] - IHT holds convertible bonds and warrants in UniGen, which could lead to an ownership stake of approximately 20% or more if fully exercised [2] Market Outlook - The management of IHT believes that the real estate held on its books is valued significantly below current market value, combined with the high profit potential from clean energy diversification, suggests a bright future for the company [3] - The travel industry, including IHT, continues to grow and thrive, indicating positive market conditions for the company's operations [8]

Core Viewpoint - InnSuites Hospitality Trust (IHT) is experiencing positive growth in the travel industry, with strong hotel operations and promising future prospects due to its investments in clean energy and real estate [1][2][5]. Financial Performance - Total Revenue for the First Fiscal Quarter of 2025 reached approximately $2.3 million, marking a 4% increase from the same period in the previous year [8]. - Consolidated Net Income before non-cash depreciation expense was reported at $259,640 for the same quarter [9]. - IHT hotel operations have shown strong performance, with record results from the Tucson and Albuquerque hotels, contributing to a total revenue of $644,741 for May [5]. Investment and Growth Strategy - IHT has made a diversification investment in UniGen Power, Inc., which is developing a clean energy generation innovation, with the potential for significant profit due to increasing electricity demand [6]. - The management believes that the real estate held by IHT is undervalued compared to current market prices, indicating a bright future for the trust [2]. Shareholder Engagement - The IHT Annual Shareholder Meeting is scheduled for August 14, 2025, at the IHT Corporate Office [3]. Dividend History - IHT has maintained uninterrupted annual dividends for 54 years, with semiannual dividends paid on February 5, 2024, and anticipated for July 31, 2024 [10].

Financial Performance - Total revenue for the three months ended April 30, 2024, was $2,293,970, an increase of 3.98% compared to $2,205,956 for the same period in 2023[12] - Consolidated net income for the three months ended April 30, 2024, was $86,598, a decrease of 81.42% from $465,445 in the prior year[12] - Operating loss for the three months ended April 30, 2024, was $178,429, compared to an operating loss of $186,280 for the same period in 2023[12] - Total operating expenses increased to $2,115,541 for the three months ended April 30, 2024, up from $2,019,676 in the same period last year, marking a rise of 4.74%[12] - The company reported a net loss attributable to controlling interests of $148,550 for the three months ended April 30, 2024, compared to a net income of $236,608 in the prior year[12] - For the Fiscal Year ended January 31, 2024, total revenues increased to approximately $7.5 million, representing a 5% increase from the prior fiscal year's total of $7.1 million[139] - Net income attributable to controlling interests for the same period was $203,880, resulting in earnings per share of $0.02[139] Assets and Liabilities - Total assets decreased to $15,284,425 as of April 30, 2024, down from $15,680,367 as of January 31, 2024, representing a decline of 2.52%[10] - Total liabilities decreased to $12,721,028 as of April 30, 2024, compared to $13,025,455 as of January 31, 2024, a reduction of 2.34%[10] - Total current assets decreased to $2,578,124 as of April 30, 2024, down from $2,981,732 as of January 31, 2024, representing a decline of 13.47%[10] - The total present value of minimum lease payments was $2,249,072, with long-term obligations of $2,223,225[123] - The scheduled minimum payments of debt as of April 30, 2024, totaled approximately $9,655,916, including $9,185,916 in mortgages and $470,000 in other notes payable[104] Cash Flow and Liquidity - Cash and cash equivalents at the end of the period were $437,343, down from $1,325,368 at the beginning of the period, reflecting a decrease of 65.92%[18] - The net cash used in operating activities was $(459,417) for the three months ended April 30, 2024, compared to $37,036 provided by operating activities in the same period last year[18] - The Trust had approximately $437,000 in cash and access to $2,250,000 in credit facilities, indicating sufficient liquidity for the next twelve months[32] - The Trust's liquidity is supported by hotel room reservation revenues and management fees, with a cash balance of approximately $437,000 as of April 30, 2024[28] - The Trust has a maximum borrowing capacity of $2,000,000 from a Demand/Revolving Line of Credit, which accrues interest at 7.0% per annum[30] Investments and Assets for Sale - As of April 30, 2024, InnSuites Hospitality Trust owns a 75.89% interest in RRF Limited Partnership, which manages two hotels with a total of 270 suites in Arizona and New Mexico[22] - The Trust's hotels are classified as operating assets but are available for sale, with management open to considering offers[24] - The Trust's investment in UniGen Power Inc. includes approximately $700,000 in note receivables and approximately $300,000 as the fair value of warrants, with a total investment of $1,000,000[71] - The Trust holds warrants to purchase up to 1,500,000 shares of UniGen Class A Common Stock, with exercise prices of $1.00 and $2.25 per share[69] - Upon conversion of the note receivable and exercise of all warrants, the Trust could own approximately 2.5 million UniGen shares, representing about 20% or more of fully diluted UniGen equity[70] Operational Insights - The Trust's principal source of cash is from hotel room reservations and management fees, with a focus on generating sufficient cash flow to meet financial obligations[28] - The Trust's revenue primarily comes from room rentals, food and beverage sales, and management fees, recognized as services are rendered[51] - The Tucson hotel experiences the highest occupancy in the first fiscal quarter, while the Albuquerque hotel is most profitable in the second and third fiscal quarters, indicating seasonal revenue fluctuations[41] - The Trust's operations are affected by seasonality, with the Tucson Hotel experiencing highest occupancy in the first fiscal quarter[41] Management and Governance - The Trust plans to change auditors and transfer agents in the second fiscal quarter of 2024[37] - The Trust has an employee equity incentive plan where independent Board members earn 6,000 fully paid restricted Shares per year, vesting over one year[58] - The Trust's management fees for the hotels are set at 5% of room revenue, with a monthly accounting fee of $2,000 per hotel[110] Advertising and Marketing - Advertising expenses for continuing operations totaled approximately $79,000 for the three months ended April 30, 2024, compared to $82,000 for the same period in 2023, reflecting a decrease of 3.66%[62] Credit and Risk Management - The Trust's maximum credit risk for accounts receivable is estimated at the amount recorded on the balance sheet, with low credit risk for cash and cash equivalents held in creditworthy institutions[63][64] - The Trust's management assesses credit risk for cash and cash equivalents as low, as funds are held in creditworthy financial institutions[63]

Phoenix, AZ, April 19, 2024 (GLOBE NEWSWIRE) -- InnSuites Hospitality Trust (NYSE:IHT) IHT management announces Filing an S-3, allowing the potential to offer and sell up to 1,000,000 shares of IHT common stock, without par value ("Common Stock"), of the Company. The S-3 prospectus includes the details as it relates to shares of IHT Common Stock that may be offered and issued from time to time. The amount of gross proceeds received will depend upon the number of shares issued, and the market price of the Co ...

Phoenix, AZ, April 08, 2024 (GLOBE NEWSWIRE) -- InnSuites Hospitality Trust (NYSE:IHT) reported continued strong annual results in Fiscal Year 2024, (February 1, 2023, to January 31, 2024), with Total Revenues increasing to approximately $7.5 million, which is an increase of from the same prior Fiscal Year total of $7.1 million. Annual Net Income Attributable to Controlling Interests was $203,880. Earnings Per Share based on this Net Income Attributable to Controlling Interest amount was $0.02. Consolidated ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (State or other jurisdiction of incorporation or organization) FORM 10-K ANNUAL REPORT ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year ended January 31, 2024. ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-7062 INNSUITES HOSPITALITY TRUST (Exact name of registrant as specified in its charter) Ohio 34-6647590 (I ...

PART I. FINANCIAL INFORMATION [ITEM 1. FINANCIAL STATEMENTS](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Presents unaudited condensed consolidated financial statements: Balance Sheets, Operations, Equity, and Cash Flows. [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets | Metric | October 31, 2023 | January 31, 2023 | | :----------------------------------- | :--------------- | :--------------- | | **Assets** | | | | Cash | $1,904,676 | $2,111,383 | | Total Current Assets | $3,271,268 | $4,167,504 | | TOTAL ASSETS | $15,976,227 | $17,019,972 | | **Liabilities** | | | | Total Current Liabilities | $1,393,861 | $1,811,140 | | TOTAL LIABILITIES | $12,717,690 | $13,337,827 | | **Equity** | | | | TOTAL EQUITY | $3,258,537 | $3,682,145 | | TOTAL LIABILITIES AND EQUITY | $15,976,227 | $17,019,972 | - Total assets decreased by approximately **$1.04 million** from January 31, 2023, to October 31, 2023, primarily driven by a reduction in current assets, including cash and employee retention credit receivable[9](index=9&type=chunk) - Total equity decreased by approximately **$0.42 million**, from **$3,682,145** to **$3,258,537**, during the nine months ended October 31, 2023[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations – Nine Months (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%E2%80%93%20Nine%20Months%20Ended%20October%2031%2C%202023%20and%20October%2031%2C%202022) Condensed Consolidated Statements of Operations – Nine Months (Unaudited) | Metric | Nine Months Ended Oct 31, 2023 | Nine Months Ended Oct 31, 2022 | Change ($) | Change (%) | | :------------------------------------------ | :----------------------------- | :----------------------------- | :--------- | :--------- | | TOTAL REVENUE | $5,751,583 | $5,539,814 | $211,769 | 3.82% | | TOTAL OPERATING EXPENSES | $5,881,402 | $5,523,895 | $357,507 | 6.47% | | OPERATING INCOME (LOSS) | $(129,819) | $15,919 | $(145,738) | -915.50% | | CONSOLIDATED NET INCOME | $611,693 | $729,783 | $(118,090) | -16.18% | | NET INCOME ATTRIBUTABLE TO CONTROLLING INTERESTS | $296,885 | $371,213 | $(74,328) | -20.02% | | NET INCOME PER SHARE – BASIC & DILUTED | $0.03 | $0.04 | $(0.01) | -25.00% | - Operating income shifted to a **loss of $(129,819)** in 2023 from an income of **$15,919** in 2022, a significant decrease of **915.50%**[11](index=11&type=chunk) - Consolidated Net Income decreased by **16.18%** year-over-year, primarily due to higher operating expenses outpacing revenue growth[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations – Three Months (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%E2%80%93%20Three%20Months%20Ended%20October%2031%2C%202023%20and%20October%2031%2C%202022) Condensed Consolidated Statements of Operations – Three Months (Unaudited) | Metric | Three Months Ended Oct 31, 2023 | Three Months Ended Oct 31, 2022 | Change ($) | Change (%) | | :------------------------------------------ | :------------------------------ | :------------------------------ | :--------- | :--------- | | TOTAL REVENUE | $1,824,499 | $1,704,612 | $119,887 | 7.03% | | TOTAL OPERATING EXPENSES | $1,974,539 | $1,834,828 | $139,711 | 7.61% | | OPERATING LOSS | $(150,040) | $(130,216) | $(19,824) | -15.22% | | CONSOLIDATED NET INCOME | $90,088 | $107,995 | $(17,907) | -16.58% | | NET INCOME ATTRIBUTABLE TO CONTROLLING INTERESTS | $61,444 | $95,165 | $(33,721) | -35.43% | | NET INCOME PER SHARE – BASIC & DILUTED | $0.01 | $0.01 | $0.00 | 0.00% | - Total revenue increased by **7.03%** for the three months ended October 31, 2023, compared to the same period in 2022, reaching approximately **$1.82 million**[13](index=13&type=chunk) - Consolidated Net Income decreased by **16.58%** to **$90,088**, while Net Income Attributable to Controlling Interests saw a larger decline of **35.43%** to **$61,444**[13](index=13&type=chunk) [Condensed Consolidated Statements of Shareholders' Equity (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity%20%E2%80%93%20Three%20and%20Nine%20Months%20Ended%20October%2031%2C%202023%20and%20October%2031%2C%202022) Condensed Consolidated Statements of Shareholders' Equity (Unaudited) | Metric | October 31, 2023 | January 31, 2023 | | :------------------------------------------ | :--------------- | :--------------- | | Trust Shareholders' Equity | $6,405,854 | $6,575,048 | | Non-Controlling Interest | $(3,147,317) | $(2,892,903) | | Total Equity | $3,258,537 | $3,682,145 | - Total equity decreased from **$3,682,145** at January 31, 2023, to **$3,258,537** at October 31, 2023, primarily due to treasury stock repurchases and distributions to non-controlling interests[15](index=15&type=chunk) - The Trust repurchased treasury stock amounting to **$(399,164)** during the nine months ended October 31, 2023[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%E2%80%93%20Nine%20Months%20ended%20October%2031%2C%202023%20and%20October%2031%2C%202022) Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Activity | Nine Months Ended Oct 31, 2023 | Nine Months Ended Oct 31, 2022 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | NET CASH PROVIDED BY OPERATING ACTIVITIES | $1,511,150 | $115,457 | | NET CASH USED IN INVESTING ACTIVITIES | $(390,083) | $(322,740) | | NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | $(1,327,774) | $1,829,886 | | NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | $(206,707) | $1,622,603 | | CASH AND CASH EQUIVALENTS AT END OF PERIOD | $1,904,676 | $2,846,983 | - Net cash provided by operating activities significantly increased to **$1,511,150** in 2023 from **$115,457** in 2022[18](index=18&type=chunk) - Net cash used in financing activities was **$(1,327,774)** in 2023, a substantial shift from **$1,829,886** provided in 2022, primarily due to the absence of large borrowings on mortgage notes and increased treasury stock repurchases[18](index=18&type=chunk) [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) [1. Nature of Operations and Basis of Presentation](index=9&type=section&id=

```markdown [PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements of InnSuites Hospitality Trust and its subsidiaries for the periods ended July 31, 2023, and January 31, 2023, along with comparative data for July 31, 2022 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets from $17.02 million at January 31, 2023, to $16.36 million at July 31, 2023, with total liabilities and equity also decreasing Condensed Consolidated Balance Sheets | Metric | January 31, 2023 | July 31, 2023 | Change | Percentage Change | | :-------------------------------- | :--------------- | :-------------- | :----- | :---------------- | | Total Assets | $17,019,972 | $16,359,063 | $(660,909) | -3.88% | | Total Liabilities | $13,337,827 | $12,784,530 | $(553,297) | -4.15% | | Total Equity | $3,682,145 | $3,574,533 | $(107,612) | -2.92% | | Cash | $2,111,383 | $2,398,884 | $287,501 | 13.62% | | Employee Retention Credit Receivable | $1,753,955 | $630,907 | $(1,123,048) | -64.03% | [Condensed Consolidated Statements of Operations – Six Months Ended July 31, 2023 and July 31, 2022](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%E2%80%93%20Six%20Months%20Ended%20July%2031%2C%202023%20and%20July%2031%2C%202022) For the six months ended July 31, 2023, total revenue increased by 2% to $3.93 million, while operating expenses rose by 6%, leading to an 80% decrease in operating income and a 15% decrease in consolidated net income Condensed Consolidated Statements of Operations – Six Months Ended July 31, 2023 and July 31, 2022 | Metric | Six Months Ended July 31, 2022 | Six Months Ended July 31, 2023 | Change | Percentage Change | | :------------------------------------ | :----------------------------- | :----------------------------- | :----- | :---------------- | | Total Revenue | $3,835,202 | $3,927,084 | $91,882 | 2.40% | | Total Operating Expenses | $3,681,510 | $3,896,643 | $215,133 | 5.84% | | Operating Income | $153,692 | $30,441 | $(123,251) | -80.20% | | Consolidated Net Income | $629,345 | $531,825 | $(97,520) | -15.49% | | Net Income Attributable to Controlling Interests | $283,605 | $245,661 | $(37,944) | -13.38% | | Net Income Per Share – Basic & Diluted | $0.03 | $0.03 | $0.00 | 0.00% | [Condensed Consolidated Statements of Operations – Three Months Ended July 31, 2023 and July 31, 2022](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%E2%80%93%20Three%20Months%20Ended%20July%2031%2C%202023%20and%20July%2031%2C%202022) For the three months ended July 31, 2023, total revenue increased by 1% to $1.72 million, but operating expenses rose by 11%, resulting in an operating loss and a 71% decrease in consolidated net income Condensed Consolidated Statements of Operations – Three Months Ended July 31, 2023 and July 31, 2022 | Metric | Three Months Ended July 31, 2022 | Three Months Ended July 31, 2023 | Change | Percentage Change | | :------------------------------------ | :------------------------------- | :------------------------------- | :----- | :---------------- | | Total Revenue | $1,699,107 | $1,721,128 | $22,021 | 1.30% | | Total Operating Expenses | $1,683,518 | $1,867,165 | $183,647 | 10.91% | | Operating (Loss) Income | $15,589 | $(146,037) | $(161,626) | -1036.79% | | Consolidated Net Income | $260,195 | $76,182 | $(184,013) | -70.72% | | Net Income Attributable to Controlling Interests | $102,527 | $18,855 | $(83,672) | -81.61% | | Net Income Per Share – Basic & Diluted | $0.01 | $0.00 | $(0.01) | -100.00% | [Condensed Consolidated Statements of Shareholders' Equity – Six Months Ended July 31, 2023 and July 31, 2022](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders%27%20Equity%20%E2%80%93%20Six%20Months%20Ended%20July%2031%2C%202023%20and%20July%2031%2C%202022) For the six months ended July 31, 2023, total equity decreased from $3.68 million to $3.57 million, primarily due to treasury stock repurchases and distributions to non-controlling interests, partially offset by net income Condensed Consolidated Statements of Shareholders' Equity – Six Months Ended July 31, 2023 and July 31, 2022 | Metric | January 31, 2023 | July 31, 2023 | Change | | :------------------------------------ | :--------------- | :-------------- | :----- | | Total Equity | $3,682,145 | $3,574,533 | $(107,612) | | Net Income Attributable to Controlling Interests | - | $245,661 | - | | Purchase of Treasury Stock | - | $(226,180) | - | | Distributions to Non-Controlling Interests | - | $(346,342) | - | [Condensed Consolidated Statements of Cash Flows – Six Months ended July 31, 2023 and July 31, 2022](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%E2%80%93%20Six%20Months%20ended%20July%2031%2C%202023%20and%20July%2031%2C%202022) Net cash provided by operating activities significantly increased to $1.44 million for the six months ended July 31, 2023, while net cash used in financing activities shifted to a deficit of $0.87 million due to the absence of large mortgage borrowings Condensed Consolidated Statements of Cash Flows – Six Months ended July 31, 2023 and July 31, 2022 | Metric | Six Months Ended July 31, 2022 | Six Months Ended July 31, 2023 | Change | | :------------------------------------ | :----------------------------- | :----------------------------- | :----- | | Net Cash Provided By Operating Activities | $128,998 | $1,438,884 | $1,309,886 | | Net Cash Used In Investing Activities | $(241,599) | $(277,194) | $(35,595) | | Net Cash (Used In) Provided By Financing Activities | $2,111,766 | $(874,189) | $(2,985,955) | | Net Increase In Cash And Cash Equivalents | $1,999,165 | $287,501 | $(1,711,664) | | Cash And Cash Equivalents At End Of Period | $3,223,545 | $2,398,884 | $(824,661) | | Employee Retention Credit (Operating Activities Adjustment) | $(701,582) | $1,123,048 | $1,824,630 | [Notes to Condensed Consolidated Financial Statements (unaudited)](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) These notes provide detailed explanations and disclosures for the condensed consolidated financial statements, covering the Trust's operations, accounting policies, ownership structures, debt, related party transactions, commitments, and significant events [1. Nature of Operations and Basis of Presentation](index=9&type=section&id=1.%20Nature%20of%20Operations%20and%20Basis%20of%20Presentation) InnSuites Hospitality Trust operates two hotels in Arizona and New Mexico, holds a diversification investment in UniGen Power Inc., and is exploring strategic options including hotel sales or mergers - IHT operates two hotels (270 suites) in Tucson, AZ and Albuquerque, NM, under the "InnSuites" and "Best Western" brands[19](index=19&type=chunk) - IHT holds a **$1 million 6% convertible debenture** in UniGen Power Inc., approximately **$618,750** in UniGen common stock (525,000 shares), and warrants for future investments[19](index=19&type=chunk) - The Trust is the sole general partner of RRF Limited Partnership, owning a **75.98% interest**, and directly owns a **21% interest** in the Albuquerque hotel, while the Partnership owns a **51.01% interest** in the Tucson hotel[21](index=21&type=chunk) - The hotels are classified as operating assets but are available for sale, though no specific timeline for sale is predicted[23](index=23&type=chunk) - As of July 31, 2023, the Trust had **$2,399,000 cash** and access to **$2,250,000** in credit facilities, believing it has sufficient liquidity for the next 12 months[31](index=31&type=chunk) - Management is analyzing strategic options including hotel sales, merger, or reverse merger[31](index=31&type=chunk) - Hotel operations are seasonal, with Tucson's highest occupancy in Q1/Q4 and Albuquerque's in Q2/Q3, providing some balance[39](index=39&type=chunk) [2. Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section details the Trust's significant accounting policies, including property depreciation, revenue recognition, accounts receivable, lease accounting, stock-based compensation, and the valuation of its investment in UniGen Power, Inc - Property and equipment are stated at cost and depreciated using the straight-line method over estimated lives (up to **40 years** for buildings, **3-10 years** for furniture/fixtures); land is tested annually for impairment[43](index=43&type=chunk)[44](index=44&type=chunk) - Revenue is primarily derived from room rentals, food and beverage sales, management and trademark fees, recognized as services are rendered[49](index=49&type=chunk) - Accounts receivable are carried at original amounts billed less an allowance for doubtful accounts (**50% over 90 days**, **100% over 120 days**); no allowance was recorded for the six months ended July 31, 2023[53](index=53&type=chunk) - Independent Trustees earn **9,000 IHT restricted shares** annually, vesting over one year[56](index=56&type=chunk) - Advertising expense for operations totaled approximately **$165,000** for the six months ended July 31, 2023, down from **$171,000** in 2022[61](index=61&type=chunk) - The Trust's investment in UniGen Power, Inc. includes a **$1,000,000 secured convertible debenture (6% interest)**, warrants to purchase up to **1,500,000 shares**, and **525,000 common shares** purchased at **$618,750**, with potential for up to **25% fully diluted equity ownership**[70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk)[78](index=78&type=chunk) - UniGen is in the R&D phase, making progress on its UPI 1000TA prototype, and is seeking additional capital[78](index=78&type=chunk)[79](index=79&type=chunk) - The UniGen investment is valued as a Level 3 fair value measurement[81](index=81&type=chunk) [3. Ownership Interests in Albuquerque and Tucson Subsidiaries](index=17&type=section&id=3.%20Ownership%20Interests%20in%20Albuquerque%20and%20Tucson%20Subsidiaries) The Trust has sold non-controlling interests in its Albuquerque and Tucson hotel subsidiaries as part of its Equity Enhancement Plan, maintaining at least 50.1% ownership in one entity, with units structured in classes with differing distribution priorities - Non-controlling interests were sold in Albuquerque Suite Hospitality, LLC and Tucson Hospitality Properties, LLLP as part of the Trust's Equity Enhancement Plan[82](index=82&type=chunk)[83](index=83&type=chunk) - Units are allocated to three classes: Class A (unrelated third parties, priority distributions), Class B (Trust, second priority), and Class C (Mr. Wirth/affiliates, lowest priority)[82](index=82&type=chunk) - As of April 30, 2023, the Trust held a **21.50% ownership interest** in the Albuquerque entity, and the Partnership held a **51.01% ownership interest** in the Tucson entity[85](index=85&type=chunk)[86](index=86&type=chunk) [4. Variable Interest Entities](index=18&type=section&id=4.%20Variable%20Interest%20Entities) The Partnership has identified Albuquerque Suite Hospitality, LLC as a variable interest entity (VIE) and is its primary beneficiary, consolidating its financial statements based on guarantees and controlling ownership - Albuquerque Suite Hospitality, LLC is determined to be a variable interest entity (VIE) with the Partnership as the primary beneficiary[88](index=88&type=chunk) - The Partnership's control is based on guarantees of material financial obligations, controlling ownership interest, and control over decisions impacting financial performance[88](index=88&type=chunk)[89](index=89&type=chunk) [5. Property and Equipment](index=18&type=section&id=5.%20Property%20and%20Equipment) This section details the composition of hotel properties and corporate property, plant, and equipment (PP&E), both of which saw minor net decreases from January 31, 2023, to July 31, 2023 Property and Equipment | Metric | January 31, 2023 | July 31, 2023 | Change | | :-------------------------------- | :--------------- | :-------------- | :----- | | Hotel properties, net | $7,166,199 | $7,083,032 | $(83,167) | | Corporate Property, Plant and Equipment, net | $43,289 | $38,864 | $(4,425) | [6. Mortgage Notes Payable](index=20&type=section&id=6.%20Mortgage%20Notes%20Payable) The Trust has two primary mortgage notes payable: an $8.4 million loan for the Tucson hotel (refinanced in March 2022 at 4.99% interest) and a $1.4 million loan for the Albuquerque hotel (December 2019 at 4.90% initial interest), both guaranteed by IHT and related parties - Tucson Hospitality Properties LLLP funded a new **$8.4 million loan** on March 29, 2022, at **4.99% interest**, with a balance of approximately **$8,135,000** as of July 31, 2023[94](index=94&type=chunk)[95](index=95&type=chunk) - Albuquerque Suites Hospitality, LLC entered a **$1.4 million Business Loan Agreement** on December 2, 2019, with an initial interest rate of **4.90%**, and a balance of approximately **$1,228,000** as of July 31, 2023[96](index=96&type=chunk) - Both credit facilities are guaranteed by InnSuites Hospitality Trust and related parties[94](index=94&type=chunk)[96](index=96&type=chunk) [7. Notes Payable and Notes Receivable – Related Party](index=20&type=section&id=7.%20Notes%20Payable%20and%20Notes%20Receivable%20%E2%80%93%20Related%20Party) The Trust has a Demand/Revolving Line of Credit/Promissory Note with Rare Earth Financial, LLC (a related party) with a maximum borrowing capacity of $2,000,000 at 7.0% interest, with zero balances as of July 31, 2023 - The Trust has a Demand/Revolving Line of Credit/Promissory Note with Rare Earth Financial, LLC (a related party) with a maximum borrowing capacity of **$2,000,000** at **7.0% per annum**[97](index=97&type=chunk) - As of July 31, 2023, the Trust had an amount receivable of approximately **$0** and an amount payable of approximately **$0** on this line of credit[97](index=97&type=chunk) [8. Other Notes Payable](index=20&type=section&id=8.%20Other%20Notes%20Payable) The Trust has two unsecured notes payable to individual lenders totaling $470,000, both at 4.5% interest and extended to December 2024, with no outstanding promissory notes from repurchases of Class A Partnership units - As of July 31, 2023, the Trust had a **$200,000 unsecured note payable** with an individual lender at **4.5% interest**, due on demand or in December 2024[99](index=99&type=chunk) - The Trust also had an unsecured loan totaling **$270,000** with an individual investor at **4.5% interest**, extended to December 2024[100](index=100&type=chunk) [9. Minimum Debt Payments](index=21&type=section&id=9.%20Minimum%20Debt%20Payments) Scheduled minimum debt payments, net of debt discounts, total approximately $9.83 million, with $581,308 due in Fiscal Year 2024, primarily from mortgages and other notes payable Minimum Debt Payments | Fiscal Year | Mortgages | Other Notes Payable | Notes Payable - Related Party | Total | | :---------- | :-------- | :------------------ | :---------------------------- | :------ | | 2024 | $111,308 | $470,000 | $- | $581,308 | | 2025 | $234,169 | $- | $- | $234,169 | | 2026 | $247,906 | $- | $- | $247,906 | | 2027 | $260,999 | $- | $- | $260,999 | | 2028 | $263,125 | $- | $- | $263,125 | | Thereafter | $8,245,892 | $- | $- | $8,245,892 | | **Total** | **$9,363,399** | **$470,000** | **$-** | **$9,833,399** | [10. Description of Beneficial Interests](index=21&type=section&id=10.%20Description%20of%20Beneficial%20Interests) Holders of the Trust's Shares of Beneficial Interest are entitled to dividends and voting rights, and the Trust repurchased 53,159 shares for the six months ended July 31, 2023, with plans for continued repurchases - Holders of Shares of Beneficial Interest are entitled to dividends, share ratably in assets upon liquidation, and possess ordinary voting rights (one vote per share)[104](index=104&type=chunk) - The Trust repurchased **53,159 Shares of Beneficial Interest** at an average price of **$3.04 per share** for the six months ended July 31, 2023[105](index=105&type=chunk) - The Trust intends to continue repurchasing Shares of Beneficial Interest[105](index=105&type=chunk) [11. Related Party Transactions](index=21&type=section&id=11.%20Related%20Party%20Transactions) Mr. Wirth and his affiliates hold significant interests in the Trust and its Partnership, which manages the hotels for a fee, and an immediate family member is employed for IT support - Mr. Wirth and his affiliates held **22.51%** of total outstanding Partnership units and **69.81%** of total issued and outstanding Shares of Beneficial Interest in the Trust as of July 31, 2023[106](index=106&type=chunk) - The Trust manages the Hotels through its majority-owned subsidiary, RRF Limited Partnership, charging management fees of **5% of room revenue** and a monthly accounting fee of **$2,000 per hotel**[108](index=108&type=chunk) - An immediate family member of Mr. Wirth is employed part-time for IT Technology support services, receiving approximately **$37,000 per year** plus bonuses[109](index=109&type=chunk) [12. Statements of Cash Flows, Supplemental Disclosures](index=22&type=section&id=12.%20Statements%20of%20Cash%20Flows%2C%20Supplemental%20Disclosures) Supplemental cash flow disclosures indicate that the Trust paid $250,000 in cash for interest for the six months ended July 31, 2023, an increase from the prior year, with no cash paid for taxes Statements of Cash Flows, Supplemental Disclosures | Metric | Six Months Ended July 31, 2022 | Six Months Ended July 31, 2023 | Change | | :-------------------- | :----------------------------- | :----------------------------- | :----- | | Cash paid for interest | $240,000 | $250,000 | $10,000 | | Cash paid for taxes | $0 | $0 | $0 | [13. Commitments and Contingencies](index=22&type=section&id=13.%20Commitments%20and%20Contingencies) The Trust has commitments including a mortgage loan agreement requiring 4% of Tucson hotel room revenue for capital expenditures and membership fees with Best Western, while management believes routine legal actions will not materially affect financial position - The Trust is obligated under a loan agreement for the Tucson Oracle property to deposit **4% of room revenue** into an escrow account for capital expenditures; no cash balance existed in Restricted Cash as of July 31, 2023[111](index=111&type=chunk) - The Tucson and Albuquerque Hotels have membership agreements with Best Western, incurring fees of approximately **$97,000** for the six months ended July 31, 2023 (compared to $93,000 in 2022)[112](index=112&type=chunk) - Management believes the ultimate disposition of various claims and legal actions will not have a material adverse effect on the Trust's consolidated financial position, results of operations, or liquidity[114](index=114&type=chunk) - Indemnification agreements are in place for executive officers and Trustees, covering liabilities and expenses, excluding bad faith or willful misconduct[116](index=116&type=chunk) [14. Leases](index=23&type=section&id=14.%20Leases) The Trust holds operating leases for its corporate offices and land in Albuquerque, and a finance lease for cable equipment in Tucson, with associated costs and remaining terms detailed for the six months ended July 31, 2023 - The Trust holds operating leases for its corporate offices (month-to-month) and land in Albuquerque (ground lease expires 2058)[118](index=118&type=chunk)[119](index=119&type=chunk) Operating Lease Costs | Metric | Six Months Ended July 31, 2023 | | :-------------------- | :----------------------------- | | Operating Lease Costs | $29,727 | | Weighted average remaining operating lease term | 34 years | | Weighted average discount rate (operating leases) | 4.85% | - The Tucson Oracle Hotel is subject to a non-cancelable cable finance lease expiring in 2023[122](index=122&type=chunk) Finance Lease Costs | Metric | Six Months Ended July 31, 2023 | | :------------------------------------ | :----------------------------- | | Amortization of right-of-use assets (Finance Lease) | $13,874 | | Interest on lease obligations (Finance Lease) | $402 | | Weighted average remaining finance lease term | 1 year | | Weighted average discount rate (finance leases) | 4.85% | [15. Share-Based Payments](index=26&type=section&id=15.%20Share-Based%20Payments) On May 15, 2023, the Board of Trustees approved a grant of 46,000 fully paid IHT restricted shares to Officers, Trustees, and Key Employees, with an aggregate grant date fair value of approximately $55,200, vesting partially in late 2023 and early 2024 - On May 15, 2023, the Trust's Board of Trustees approved a grant of **46,000 fully paid IHT restricted shares** to Officers, Trustees, and Key Employees[123](index=123&type=chunk) - The aggregate grant date fair value of these shares was approximately **$55,200**[123](index=123&type=chunk) - These shares vest partially on December 31, 2023, and February 28, 2024[123](index=123&type=chunk) [16. Notes Receivable (IBC Hospitality Technologies)](index=26&type=section&id=16.%20Notes%20Receivable%20(IBC%20Hospitality%20Technologies)) The Trust holds a secured promissory note of $1,925,000 from the sale of its technology subsidiary, IBC Hotels LLC, with 3.75% interest, maturing on June 1, 2024, and management believes its collectability is probable - The Trust holds a secured promissory note of **$1,925,000** from the sale of its technology subsidiary, IBC Hotels LLC, with interest accrued at **3.75% per annum**[124](index=124&type=chunk) - No interest accrued or payments on the note receivable (principal and interest) are due through May 2023[127](index=127&type=chunk) - The note matures on June 1, 2024, and IHT is in discussions for a further extension/modification[127](index=127&type=chunk) - Management believes the collectability of the current carrying value of the note is probable[125](index=125&type=chunk) [17. Income Taxes](index=26&type=section&id=17.%20Income%20Taxes) The Trust is taxed as a C-Corporation and, as of January 31, 2023, had deferred tax assets of $4.3 million and a deferred tax liability of $1.8 million, with a valuation allowance of approximately $2.6 million - The Trust is taxed as a C-Corporation[127](index=127&type=chunk) - As of January 31, 2023, the Trust had deferred tax assets of **$4.3 million** (comprising **$1.4 million** in net operating loss carryforwards and **$2.9 million** in syndications) and a deferred tax liability of **$1.8 million**[127](index=127&type=chunk) - A valuation allowance of approximately **$2.6 million** was determined against the net deferred tax asset[127](index=127&type=chunk) [18. COVID-19 Disclosure](index=27&type=section&id=18.%20COVID-19%20DISCLOSURE) The detrimental impact of COVID-19 on the Trust's business, financial results, and liquidity has significantly diminished, with lodging demand and revenue levels largely recovered and no longer considered a major factor for Fiscal Year 2024 - The material detrimental impact of COVID-19 on the Trust's business, financial results, and liquidity has significantly diminished[128](index=128&type=chunk)[130](index=130&type=chunk) - Lodging demand and revenue levels have rebounded to near full recovery[130](index=130&type=chunk) - COVID-19 is no longer considered a major factor for Fiscal Year 2024 (February 1, 2023, to January 31, 2024)[130](index=130&type=chunk) [19. Occupancy Tax](index=27&type=section&id=19.%20Occupancy%20Tax) No occupancy tax assessments have occurred since September 2020, and management has concluded that any discrepancy on prior reported periods is qualitatively immaterial - No occupancy tax assessments have transpired since September 2020[131](index=131&type=chunk) - Management has assessed the materiality of any discrepancy on prior reported periods and concluded it is qualitatively immaterial[131](index=131&type=chunk) [20. Employee Retention Tax Credit](index=27&type=section&id=20.%20Employee%20Retention%20Tax%20Credit) The Trust is participating in the Employee Retention Credit program, expecting to receive approximately $2.7 million in employment tax refunds and credits for 2020 and 2021, having received $1.9 million as of July 31, 2023 - The Trust is participating in the Employee Retention Credit program, expecting to receive approximately **$2.7 million** in employment tax refunds and credits for 2020 and 2021[132](index=132&type=chunk)[133](index=133&type=chunk) - As of July 31, 2023, IHT has received approximately **$1.9 million** and is expected to receive an additional **$0.8 million**[133](index=133&type=chunk) [21. Subsequent Events](index=27&type=section&id=21.%20Subsequent%20Events) The Trust maintains a conservative dividend policy, repurchased 76,165 shares after July 31, 2023, and expects continued record hotel operating results for FY2024, while remaining compliant with NYSE American listing standards - The Trust maintains a conservative dividend policy, paying two semi-annual dividends totaling **$0.02 per share** per Fiscal Year[134](index=134&type=chunk) - Subsequent to July 31, 2023, the Trust repurchased **76,165 Shares of Beneficial Interest** for approximately **$183,533**[135](index=135&type=chunk) - Hotel operations achieved record results for Fiscal Year ended January 31, 2023, with Net Income Attributable to Controlling Interests doubling (**106% increase**) to **$523,171** and EPS increasing to **$0.06**[136](index=136&type=chunk) - Continued record results are expected for the two hotels during Fiscal Year 2024[136](index=136&type=chunk) - IHT is fully compliant with all NYSE American Continued Listing Standards Equity Requirements as of August 29, 2022[135](index=135&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Trust's financial performance, condition, and future outlook, including forward-looking statements, hotel operations, liquidity, and strategic positioning [General](index=29&type=section&id=General) This section provides management's discussion and analysis of the Trust's financial condition and results of operations, to be read in conjunction with the unaudited condensed consolidated financial statements and the audited Form 10-K - The discussion should be read in conjunction with the unaudited condensed consolidated financial statements and the audited Form 10-K for the fiscal year ended January 31, 2023[138](index=138&type=chunk) [Forward-Looking Statements](index=29&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding future events and financial performance, subject to various uncertainties and factors that may cause actual results to differ materially, which the Trust does not undertake to update unless required by law - Statements are forward-looking and subject to many uncertainties and factors that may cause actual results to differ materially from any future results expressed or implied[139](index=139&type=chunk)[140](index=140&type=chunk) - Examples of uncertainties include virus pandemic effects on the travel industry, potential risks of investments (including UniGen), inflation, economic recession, competition, and the ability to sell hotel properties[140](index=140&type=chunk) - The Trust does not undertake any obligation to update publicly or revise any forward-looking statements except as may be required by law[142](index=142&type=chunk) [Overview](index=31&type=section&id=Overview) IHT owns and operates two moderate-service hotels, with operations constituting one reportable segment, and expects continued strong performance in FY2024, while pursuing a strategic plan to sell hotels, diversify into clean energy with UniGen, and seek a merger - IHT is engaged in the ownership and operation of two moderate-service hotels in Tucson, Arizona, and Albuquerque, New Mexico, with **270 suites**, branded as InnSuites and Best Western[143](index=143&type=chunk) - Operations consist of one reportable segment: Hotel Ownership Operations & Hotel Management Services[145](index=145&type=chunk) - The Trust expects Fiscal Year 2024 to continue strong for the travel industry, with increased room rates and cost control leading to improved profitability, supported by fully completed hotel refurbishments[148](index=148&type=chunk) - The strategic plan is to obtain full market value for the two Hotels (over the next 12-36 months), diversify with the UniGen clean energy investment, and seek a larger private reverse merger partner[149](index=149&type=chunk)[150](index=150&type=chunk) - The UniGen investment includes **$1 million** in convertible debentures, **525,000 UniGen shares**, and warrants to purchase approximately an additional **2 million shares**, potentially resulting in up to **25% ownership**[150](index=150&type=chunk) [Hotel Operations (Performance Metrics)](index=32&type=section&id=Hotel%20Operations%20(Performance%20Metrics)) Hotel operating expenses primarily consist of labor, property taxes, insurance, corporate overhead, interest on mortgage debt, professional fees, depreciation, and hotel operating expenses, with performance evaluated using occupancy, average daily rate (ADR), and revenue per available room (REVPAR) - Hotel operating expenses primarily consist of labor, property taxes, insurance, corporate overhead, interest on mortgage debt, professional fees, depreciation, and hotel operating expenses[151](index=151&type=chunk) - Performance is evaluated using occupancy (rooms sold/total rooms), average daily rate (ADR) (total room revenue/rooms sold), and revenue per available room (REVPAR) (total room revenue/rooms available)[151](index=151&type=chunk) Combined Hotel Performance (Six Months Ended July 31) | Metric | 2023 | 2022 | Change | % Change | | :----------------------- | :----- | :----- | :----- | :------- | | Occupancy | 83.28% | 77.00% | 6.28% | 8.16% | | Average Daily Rate (ADR) | $94.95 | $99.21 | $(4.26) | -4.29% | | Revenue Per Available Room (REVPAR) | $79.07 | $76.39 | $2.68 | 3.51% | Albuquerque Hotel Performance (Six Months Ended July 31) | Metric | 2023 | 2022 | Change | % Change | | :----------------------- | :----- | :----- | :----- | :------- | | Occupancy | 91.60% | 85.10% | 6.50% | 7.64% | | Average Daily Rate (ADR) | $97.05 | $100.37 | $(3.32) | -3.31% | | Revenue Per Available Room (REVPAR) | $88.90 | $85.42 | $3.48 | 4.07% | Tucson Hotel Performance (Six Months Ended July 31) | Metric | 2023 | 2022 | Change | % Change | | :----------------------- | :----- | :----- | :----- | :------- | | Occupancy | 77.38% | 71.26% | 6.12% | 8.59% | | Average Daily Rate (ADR) | $93.18 | $98.22 | $(5.04) | -5.13% | | Revenue Per Available Room (REVPAR) | $72.10 | $69.99 | $2.11 | 3.01% | [Results of Operations for the Fiscal Twelve Month Trailing Ended July 31, 2023 Compared to the Fiscal Twelve Month Trailing Ended July 31, 2022](index=34&type=section&id=Results%20of%20Operations%20for%20the%20Fiscal%20Twelve%20Month%20Trailing%20Ended%20July%2031%2C%202023%20Compared%20to%20the%20Fiscal%20Twelve%20Month%20Trailing%20Ended%20July%2031%2C%202022) For the twelve months ended July 31, 2023, total revenues increased by 1% to $7.24 million, while operating expenses rose by 8%, leading to an operating loss and a 60% decrease in consolidated net income despite a 100% increase in Employee Retention Benefit Financial Performance (Twelve Months Ended July 31) | Metric | FY 2023/2024 | FY 2022/2023 | Change | % Change | | :---------------------- | :----------- | :----------- | :------- | :------- | | Total Revenues | $7,237,569 | $7,175,813 | $61,756 | 1% | | Operating Expenses | $7,658,155 | $7,081,308 | $576,847 | 8% | | Operating (Loss) Income | $(420,586) | $94,505 | $(515,091) | 545% | | Consolidated Net Income | $639,531 | $1,610,355 | $(970,824) | 60% | | Employee Retention Benefit | $1,403,164 | $1,052,373 | $350,791 | 100% | [Results of Operations for the Six Months Ended July 31, 2023 Compared to the Six Months Ended July 31, 2022](index=34&type=section&id=Results%20of%20Operations%20for%20the%20Six%20Months%20Ended%20July%2031%2C%202023%20Compared%20to%20the%20Six%20Months%20Ended%20July%2031%2C%202022) For the six months ended July 31, 2023, total revenue increased by 2% to $3.93 million, driven by recovery and refurbishments, while operating expenses increased by 6%, leading to an 80% decrease in operating income and a 15% decrease in consolidated net income Financial Performance (Six Months Ended July 31) | Metric | 2023 | 2022 | Change | % Change | | :---------------------- | :----------- | :----------- | :------- | :------- | | Total Revenues | $3,927,084 | $3,835,202 | $91,882 | 2% | | Operating Expenses | $3,896,643 | $3,681,510 | $215,133 | 6% | | Operating Income | $30,441 | $153,692 | $(123,251) | 80% | | Consolidated Net Income | $531,825 | $629,345 | $(97,520) | (15%) | - Earnings Per Share based on Consolidated Net Income decreased by **15%** to **$0.06** (2023) from **$0.07** (2022)[160](index=160&type=chunk) - Earnings Per Share based on net income attributable to Controlling Interest remained flat at **$0.03** for both periods[160](index=160&type=chunk) - Room revenues increased by **3%** to approximately **$3.86 million** for the six months ended July 31, 2023, compared to **$3.75 million** in the prior year[162](index=162&type=chunk) - Total expenses net of interest expense increased by approximately **$0.38 million**, or **10%**, to **$4.06 million**[163](index=163&type=chunk) - Hospitality expense increased by approximately **$69,000**, or **43%**, to **$232,000**, primarily due to COVID-19 regulations minimizing food service availability[169](index=169&type=chunk) [Results of Operations for the Three Months Ended July 31, 2023 Compared to the Three Months Ended July 31, 2022](index=36&type=section&id=Results%20of%20Operations%20for%20the%20Three%20Months%20Ended%20July%2031%2C%202023%20Compared%20to%20the%20Three%20Months%20Ended%20July%2031%2C%202022) For the three months ended July 31, 2023, total revenue increased by 1% to $1.72 million, but operating expenses rose by 11%, leading to an operating loss and a significant 71% decrease in consolidated net income Financial Performance (Three Months Ended July 31) | Metric | 2023 | 2022 | Change | % Change | | :---------------------- | :----------- | :----------- | :------- | :------- | | Total Revenues | $1,721,128 | $1,699,107 | $22,021 | 1% | | Operating Expenses | $1,867,165 | $1,683,518 | $(183,647) | (11%) | | Operating (Loss) Income | $(146,037) | $15,589 | $(161,626) | 1,037% | | Consolidated Net Income | $76,182 | $260,195 | $(184,013) | 71% | - Earnings Per Share based on Consolidated Net Income decreased to **$0.01** (2023) from **$0.03** (2022)[175](index=175&type=chunk) - Earnings Per Share based on net income attributable to Controlling Interest decreased to **$0.00** (2023) from **$0.01** (2022)[175](index=175&type=chunk) - Room revenues increased by **1%** to approximately **$1.69 million** for the three months ended July 31, 2023, compared to **$1.66 million** in the prior year[177](index=177&type=chunk) - Total expenses net of interest expense increased by approximately **$0.03 million**, or **20%**, to **$2.03 million**[178](index=178&type=chunk) - Hospitality expense increased by approximately **$26,000**, or **31%**, to **$111,000**, primarily due to COVID-19 reduction of regulations minimizing food service availability[185](index=185&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The Trust's primary cash sources are hotel management fees, distributions, and potential hotel sales, with $2.4 million in cash and $2.25 million in credit lines as of July 31, 2023, providing sufficient liquidity for the next 12 months - Primary cash sources include monthly management fees from hotels, distributions from the Partnership, and potential future real estate hotel sales[190](index=190&type=chunk) - As of July 31, 2023, the Trust had approximately **$2.4 million** of cash and availability of **$2.25 million** from combined credit facilities, believing it has enough cash to meet financial obligations for at least the next twelve months[192](index=192&type=chunk) - Net cash provided by operating activities totaled approximately **$1,439,000** during the six months ended July 31, 2023, compared to **$129,000** in the prior year[196](index=196&type=chunk) - Net cash used in investing activities totaled approximately **$277,000** for the six months ended July 31, 2023, primarily due to improvements and additions to hotel properties[199](index=199&type=chunk) - Net cash (used in) provided by financing activities totaled approximately **$(874,000)** for the six months ended July 31, 2023, a significant decrease from **$2,112,000** in the prior year, primarily due to the refinance of the Tucson Oracle mortgage in 2022[200](index=200&type=chunk) - Capital expenditures for hotel improvements were approximately **$247,000** for the six months ended July 31, 2023[204](index=204&type=chunk) - Minimum debt payments for Fiscal Year 2024 are approximately **$581,000**[205](index=205&type=chunk) [Competition in the Hotel Industry](index=39&type=section&id=Competition%20in%20the%20Hotel%20Industry) The hotel industry is competitive, with IHT's recent renovations expected to drive demand, and the Trust may diversify away from hotels into investments like UniGen Power, Inc., or pursue a merger - The hotel industry is competitive, and some competitors may have greater marketing and financial resources than the Trust[207](index=207&type=chunk) - Completed renovations at the Tucson and Albuquerque hotel properties are expected to see incremental demand[209](index=209&type=chunk) - The recovery of the travel industry from virus-related restrictions is benefiting the Trust's hotels in the first two fiscal quarters of 2024, with continued upward trend expected[209](index=209&type=chunk) - The Trust may diversify further into investments such as UniGen Power, Inc., or seek further diversification through a merger or reverse merger with a larger non-public entity[210](index=210&type=chunk) [Critical Accounting Policies and Estimates](index=40&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) The Trust's most critical accounting policies relate to the valuation of hotel properties, including impairment testing, with no impairment recognized for the six months ended July 31, 2023 or 2022, and plans to sell its two remaining hotel properties within 12-36 months - The most critical accounting policies relate to the valuation of hotel properties, including methods used to recognize and measure any identified impairment[212](index=212&type=chunk)[213](index=213&type=chunk) - No hotel properties impairment loss was recognized for the six months ended July 31, 2023 or 2022, and management does not believe the carrying values are impaired[213](index=213&type=chunk) - The Trust plans to sell its two remaining hotel properties (Tucson and Albuquerque) within **12-36 months** at estimated market asking prices[214](index=214&type=chunk)[229](index=229&type=chunk) Estimated Market Asking Price for Hotels (as of July 31, 2023) | Hotel Property | Book Value | Mortgage Balance | Estimated Market Asking Price | | :------------- | :--------- | :--------------- | :---------------------------- | | Albuquerque | $1,015,424 | $1,228,045 | $9,500,000 | | Tucson Oracle | $6,067,608 | $8,135,354 | $18,500,000 | | **Total** | **$7,083,032** | **$9,363,399** | **$28,000,000** | - Revenues are primarily derived from room rentals, food and beverage sales, management and trademark fees, recognized as services are rendered[215](index=215&type=chunk)[216](index=216&type=chunk) [Non-GAAP Financial Measures](index=42&type=section&id=Non-GAAP%20Financial%20Measures) The Trust presents Adjusted EBITDA and Funds From Operations (FFO) as non-GAAP measures to assist investors in evaluating operating performance, providing additional insights into financial condition and operating performance - Adjusted EBITDA and Funds From Operations (FFO) are presented as non-GAAP measures to assist investors in evaluating operating performance[222](index=222&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk) Adjusted EBITDA (Six Months Ended July 31) | Metric | 2023 | 2022 | | :------------------------------------ | :------- | :------- | | Net income attributable to controlling interests | $246,000 | $284,000 | | Add back: Depreciation | $335,000 | $344,000 | | Add back: Interest expense | $253,000 | $258,000 | | Less: Interest Income | $(34,000) | $(32,000) | | **Adjusted EBITDA** | **$800,000** | **$854,000** | Adjusted EBITDA (Three Months Ended July 31) | Metric | 2023 | 2022 | | :------------------------------------ | :------- | :------- | | Net income attributable to controlling interests | $19,000 | $103,000 | | Add back: Depreciation | $167,000 | $173,000 | | Add back: Interest expense | $163,000 | $123,000 | | Less: Interest Income | $(16,000) | $(16,000) | | **Adjusted EBITDA** | **$333,000** | **$383,000** | FFO (Six Months Ended July 31) | Metric | 2023 | 2022 | | :------------------------------------ | :------- | :------- | | Net income attributable to controlling interests | $246,000 | $284,000 | | Add back: Depreciation | $335,000 | $344,000 | | Add back: Non-controlling interest | $286,000 | $346,000 | | **FFO** | **$867,000** | **$974,000** | FFO (Three Months Ended July 31) | Metric | 2023 | 2022 | | :------------------------------------ | :------- | :------- | | Net income attributable to controlling interests | $19,000 | $103,000 | | Add back: Depreciation | $335,000 | $344,000 | | Add back: Non-controlling interest | $57,000 | $158,000 | | **FFO** | **$411,000** | **$605,000** | [Future Positioning](index=43&type=section&id=Future%20Positioning) The Trust continues to actively seek buyers for its two remaining hotel properties at estimated market asking prices totaling $28 million, with a long-term strategic plan to realize full real estate equity, benefit from the UniGen clean energy investment, and pursue a merger - The Trust continues to actively seek buyers for its two remaining Hotel properties, the Tucson Hotel and Albuquerque Hotel[226](index=226&type=chunk) Hotel Property Book Values, Mortgage Balances, and Estimated Market Asking Prices | Hotel Property | Book Value | Mortgage Balance | Estimated Market Asking Price | | :------------- | :--------- | :--------------- | :---------------------------- | | Albuquerque | $1,015,424 | $1,228,045 | $9,500,000 | | Tucson Oracle | $6,067,608 | $8,135,354 | $18,500,000 | | **Total** | **$7,083,032** | **$9,363,399** | **$28,000,000** | - The Trust plans to sell its remaining two Hotel properties within **12-36 months**[229](index=229&type=chunk) - The long-term strategic plan is to obtain the full benefit of real estate equity, benefit from the UniGen Power, Inc. clean energy operation diversified investment, and pursue a merger with a larger private entity seeking an NYSE AMERICAN Exchange listing[231](index=231&type=chunk) [Share Repurchase Program](index=43&type=section&id=Share%20Repurchase%20Program) The Trust's Share Repurchase Program was highly successful in Fiscal Year 2023 and is planned to continue in Fiscal Year 2024 - The Company Stock Buyback Plan was highly successful during Fiscal Year 2023 (February 1, 2022, to January 31, 2023)[232](index=232&type=chunk) - The Trust plans to continue the stock and unit buybacks in the current Fiscal Year 2024[232](index=232&type=chunk) [Off-Balance Sheet Arrangements](index=44&type=section&id=Off-Balance%20Sheet%20Arrangements) The Trust does not have any off-balance sheet financing arrangements or liabilities, nor any majority-owned or controlled subsidiaries not included in its consolidated financial statements - The Trust does not have any off-balance sheet financing arrangements or liabilities[233](index=233&type=chunk) - The Trust does not have any majority-owned or controlled subsidiaries that are not included in its consolidated financial statements[233](index=233&type=chunk) [Seasonality](index=44&type=section&id=Seasonality) The Hotels' operations are seasonal, with Tucson experiencing highest occupancy in Q1/Q4 and Albuquerque's most profitable periods in Q2/Q3, providing some balance, but increasing vulnerability to risks - The Tucson Arizona Hotel historically experiences the highest occupancy in the first Fiscal Quarter (winter high season) and, to a lesser extent, the fourth Fiscal Quarter, with the second Fiscal Quarter (summer low season) being the lowest[234](index=234&type=chunk) - The Albuquerque, New Mexico Hotel historically experiences its most profitable periods during the second and third Fiscal Quarters (summer high season), providing some balance to the overall seasonality[234](index=234&type=chunk) - The seasonal nature of the business increases vulnerability to risks such as travel disruptions, labor force shortages, and cash flow issues[235](index=235&type=chunk) [Inflation](index=44&type=section&id=Inflation) The Trust relies on its hotels' ability to increase revenue to keep pace with inflation, though competitive pressures may limit rate increases, with substantial rate increases experienced in Fiscal Year 2023 to offset rising expenses - The Trust relies entirely on the performance of the Hotels and InnSuites' ability to increase revenue to keep pace with inflation[236](index=236&type=chunk) - Competitive pressures may limit InnSuites' ability to raise room rates as fast as or faster than inflation[236](index=236&type=chunk) - During Fiscal Year 2023, InnSuites did experience substantial increases in rates to offset inflationary increases in labor and other expenses[236](index=236&type=chunk) [Investment in UniGen Power, Inc.](index=44&type=section&id=Investment%20in%20UniGen%20Power%2C%20Inc.) The Trust made a $1 million diversification investment in UniGen Power Inc., a clean energy company, including convertible debentures, common stock, and warrants, potentially leading to 25% fully diluted equity ownership, with UniGen currently seeking additional capital for prototype assembly and testing - The Trust made an initial **$1 million** diversification investment in UniGen Power Inc. (developing a patented efficient clean energy generation innovation) in late Fiscal Year 2020 and early Fiscal Year 2021[237](index=237&type=chunk) - The investment includes **$1,000,000** in secured convertible debentures (**6% annual interest**, convertible into **1,000,000 Class A shares**), approximately **525,000 shares** of UniGen stock, and warrants to purchase up to **1,500,000 additional shares**[238](index=238&type=chunk)[239](index=239&type=chunk)[240](index=240&type=chunk) - The total potential stock ownership upon conversion and exercise of warrants could amount to approximately **3 million UniGen shares**, representing approximately **25%** of fully diluted UniGen equity[241](index=241&type=chunk) - UniGen has completed prototype design engineering for the UPI 1000TA engine and is currently seeking additional capital to complete assembly and testing[244](index=244&type=chunk) - The UniGen investment is valued as a Level 3 fair value measurement[243](index=243&type=chunk)[248](index=248&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This item is not required for smaller reporting companies - This item is not required for smaller reporting companies[249](index=249&type=chunk) [Item 4. Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) As of July 31, 2023, management concluded that disclosure controls and procedures were fully effective, and internal control over financial reporting was also fully effective, with remediation initiatives implemented to strengthen controls - Management, including the CEO and CFO, concluded that disclosure controls and procedures were fully effective as of July 31, 2023[250](index=250&type=chunk) - Management assessed the effectiveness of internal control over financial reporting as fully effective as of July 31, 2023, based on the COSO Internal Control - Integrated Framework (2013)[254](index=254&type=chunk) - Remediation initiatives to enhance internal control over financial reporting include increasing technical accounting expertise (CFO, Corporate Controller, Staff Accountants) and improving the control environment[255](index=255&type=chunk)[256](index=256&type=chunk) - Continued positive changes in internal control over financial reporting occurred during the three months ended July 31, 2023[259](index=259&type=chunk) [PART II. OTHER INFORMATION](index=47&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The Trust has no material legal proceedings to report - The Trust has no material legal proceedings to report[261](index=261&type=chunk) [Item 1A. Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) The risks related to COVID-19 have significantly diminished, with lodging demand and revenue levels largely recovered, and the pandemic is no longer considered a major factor for Fiscal Year 2024 - The shrinking impact of COVID-19 on the Trust's business, financial results, and liquidity has significantly diminished[262](index=262&type=chunk)[263](index=263&type=chunk) - Lodging demand and revenue levels are largely recovered[263](index=263&type=chunk) - COVID-19 is no longer considered a major factor for Fiscal Year 2024 (February 1, 2023, to January 31, 2024)[263](index=263&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=47&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Holders of Shares of Beneficial Interest have dividend and voting rights, and for the three months ended July 31, 2023, the Trust repurchased 15,795 shares, intending to continue repurchases as the share price is believed to not fully recognize the Trust's value - Holders of the Trust's Shares of Beneficial Interest are entitled to receive dividends and possess ordinary voting rights[264](index=264&type=chunk) - For the three months ended July 31, 2023, the Trust repurchased **15,795 Shares of Beneficial Interest** at an average price of **$2.53 per share**[265](index=265&type=chunk) - The Trust intends to continue repurchasing Shares of Beneficial Interest, believing the share price does not fully recognize the Trust's full value and/or potential[265](index=265&type=chunk) [Item 3. Defaults Upon Senior Securities](index=48&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The Trust has no defaults upon senior securities to report - None[267](index=267&type=chunk) [Item 4. Mine Safety Disclosures](index=48&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The Trust has no mine safety disclosures to report - None[268](index=268&type=chunk) [Item 5. Other Information](index=48&type=section&id=Item%205.%20Other%20Information) No other information is reported in this section - None[269](index=269&type=chunk) [Item 6. Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including Section 302 and 906 Certifications by the CEO and CFO, and Inline XBRL Exhibits - Exhibits include Section 302 Certifications by the Chief Executive Officer and Chief Financial Officer, and Section 906 Certification of Principal Executive Officer and Principal Financial Officer[270](index=270&type=chunk) - Inline XBRL Exhibits are also included[270](index=270&type=chunk) ```